Elasticities of complementarity and substitution in some functional forms. A comparative review

Abstract

This paper presents and discusses the results of a comparative review of the elasticities of complementarity and substitution which may be obtained from seven functional forms, inflexible and flexible. Every functional form is examined in its four versions: production, cost, profit, and distance. The elasticities of complementarity were obtained from the production and distance functions (elasticities of Hicks, Antonelli and Morishima), and those of substitution from the cost and profit functions (elasticities of Allen-Uzawa and Lau). The results of the calculations of the various elasticities are compared and evaluated.